Exact Sciences Beats Quarterly Forecasts, Sending Its Stock Price Up

Xconomy Wisconsin — 

When leaders at Exact Sciences discussed dealing with the adversity of cold weather and a “historically severe” flu season in early 2018, some industry observers predicted a potential break in the long growth streak of the Madison, WI-based company’s flagship product, a stool-based DNA test for colorectal cancer known as Cologuard.

But on Thursday, Exact (NASDAQ: EXAS) said it completed 186,000 Cologuard tests during the three-month period ending March 31. The quarterly total beat the company’s projection in February that it would complete between 176,000 and 181,000 of the tests in the first quarter. Exact completed about 176,000 Cologuard tests in the previous quarter, and about 100,000 of the tests in the first quarter of 2017.

Exact develops diagnostic tests for several types of cancer, but analysts see increasing national awareness and sales of Cologuard as integral to the long-term success of the business.

Cologuard earned FDA approval and Medicare coverage in 2014, and the company began selling the test later that year. To date, more than 110,000 clinicians have ordered the test, up from about 102,000 at the end of December, Exact said.

Exact’s first-quarter revenues were $90.3 million, which eclipsed analysts’ average estimate by more than $3.3 million. The company reported a net loss of $39.4 million, or 33 cents a share, beating projections by 4 cents a share. Exact’s net losses for the previous quarter and first quarter of 2017 were $21.8 million and $34.9 million, respectively. (The company still has yet to turn a profit in the 22 years it’s been in business.)

The company said operating expenses in the first quarter were $103.9 million, up about 55 percent from a year ago. That may have contributed to the the wider loss.

Exact announced its first-quarter results shortly after the close of the trading day Thursday. The company’s stock price was $46.60 a share when the closing bell rang, up 2.9 percent from Wednesday’s closing price of $45.27 per share. However, after Exact revealed its earnings and other information from last quarter, investors sent its stock price up another 5.8 percent, to $49.32.

Exact reiterated its previous projection that total sales in 2018 will come in between $420 million and $430 million. The company’s projection for the number of Cologuard tests it will complete this year—between 900,000 and 920,000—also remains unchanged from February. (Exact completed about 571,000 Cologuard tests in 2017.) The company said it expects to complete between 220,000 and 230,000 Cologuard tests between April and June.